Bank of Nova Scotia T.BNS

Dividend

[Goldluck]

I don't care if the stock loses a bit of value,  it's the dividend that does it for me.  Better than a GIC or the market with a lot less risk.

[DeanEdmonton]

This is a tremendously silly statement. You could have bought TD or RY, got the dividend AND Capital appreciation. This is the same as people who have been buying and holding Manulife for 15 years, ZERO capital appreciation unless you bought on one of the many BIG dips. Why would anyone want to hold the worst performer of the big 6. That is the problem with ETFs as well, you get the 2 stars but

[RayDonovan78]

Dean, It could be worse, he could have bought Laurentian in the hight $40's like I got sucked into by my now fired advisor. I ditched most of my LB back in March/April 2020 and bought BNS & CM which got my money back and more with a divy roughly 7% I'm still holding because I am still way ahead even in this dip...Oh and my advisor wasnt Ross.....Lol  ;)

[DeanEdmonton]

True enough RayD. March-June 2020 was a glorious buying opportunity. There is hardly a quality stock that you would not have made money on and getting out of LB was a great move. Capture the tax loss and get into something that makes you money.

[Goldluck]

You also have to consider the cost of the shares.  For the same amount of money you get less shares of RY.

[financebuff101]

Goldluck, Here is a simple calculation I did, comparing the Big 5 banks.  If you bought one (1) share of each bank on Feb 21st, 2020 (last day before Covid hit the markets), and you held them until yesterday, here are the results.  In my opinion, it's the percentage that matters, not the perception of "cheap" / "expensive" share price, or how many you get for x

[newcoin]

That's a lot of great information. Thank you so much for posting that chart. To me, it shows the parity of the big five banks. There will always be differences year to year. Over the long term they are fantastic investments. I think the best investments in the world. I own all of them in approximately equal amounts.  

[DeanEdmonton]

Newcoin, you are completely incorrect about the large banks being equal over time. Take a look at the 10 year returns, it is REALLY clear that RY and TD have greatly outperformed and the BNS is the worst of the bigs. Same holds true if you stretch it out to 20 years. There is a very good reason not to own ETFs, you get the stars and the dogs, no point in replicating that in your own portfolio.

[DeanEdmonton]

Scroll down on the post to see the 10yr growth chart.

[newcoin]

Nobody ever went broke owning the banks. Increase dividends every year. As time passes the big 5 take turns leading the way. I like the sector. Best investments in the world. I own them individually. Thanks for your thoughts.

[BiggyG]

Newcoin, don't worry about Dean, he drives his car using the rearview mirror only, I have known a few brokers who think/talk like him.  I am with you CDN banks are top drawer bluechip stocks. GLTA

[DeanEdmonton]

Big - he who fails to learn from history is a fool. No arguement that the large Canadian banks are a solid investment, some however are much beeter at genrating SP increases than others. RY has lead the pack for 100 years. BNS has trailed the pack for just as long. Please articulate for us what is about to change with BNS that is going to put them as the front runner the next 10 years, heck even

[ICUMD14]

Good discussion Dean.   No doubt RY is a top performer over time, current PE about 11.5. BNS appears to be trading at a significant discount at current prices with PE of 8. Long term PE value closer to 10-11.  Suggests good near term upside relative to RY.  Higher dividend also generates superior cash flow.

[DeanEdmonton]

ICUMD =- you are correct about their historical P/E. There are two ways to get back to 11/1, increased share price or reduced earnings. I hope your version works out for you, the street is betting on the reduced earnings version.

[ICUMD14]

It would appear so.  IMHO biggest risk is the cdn housing market popping with incr interest rates. I think BNSs latam exposure is actually a benefit in this case.  Regardless. I'll take the 6.3% dividend and wait. I would add RY closer to 110. 

[RayDonovan78]

My crystal ball says BNS will be the best performer of the big 5 Canadian banks in 2023 ; )

[BiggyG]

Totally agree Ray, lots of upside in BNS for 2023. GLTA and Happy Holidays

[SargeX]

Hey Dean This is one of the few places where we disagree a little. My wife and I own BMO, BNS, RY, and TD and have only been adding to BNS lately to the tune of 370 shares at $68.40 ($25.3k). We also plan to add another $5k on Jan 3 with some of our new TFSA dough. We always base our allocation on book value so BNS has the highest book value and the other 3 are similar to each other. RY has the

[DeanEdmonton]

Sarge - good thing is one of us will turn out to be right :-) Since you are holding BNS, hope it is you. Good thing is, worst they will do is lag like they have for the last 20 years, sure aren't in any danger of going broke and it does pay a good dividend. Merry Christmas and a Happy New Year to you and all on the boards.

[SargeX]

Hey Dean Thanks on the Christmas and New Year's wishes. Right back at you. The higher yield as well as the punishing on the share price are definitely the reasons for us upping our BNS holding. As I've mentioned, capital appreciation is secondary to a stable dividend income/growth. Take care Sarge